Southwest Florida's share of seriously underwater homes shrank during the first quarter over the year, while those that became equity-rich grew, a new report says.

'The above-average share of both seriously underwater and equity rich homeowners in Southwest Florida markets demonstrate the extremes the market has been through over the past 10 years,' said Daren Blomquist, vice president of RealtyTrac, which released the report Thursday.

The dramatic drop during the recession, and subsequent spike during the economic recovery, has left 'most homeowners at the two opposite ends of the home equity spectrum, and few homeowners in the center of the home equity spectrum,' he said.

Collier and Lee counties have a higher percentage than the national average of homes that are seriously underwater; their loan-to-value ratio is 125 percent or more.

Nationally, more than 6.7 million properties were seriously underwater at the end of the first quarter, or 12 percent of all mortgaged properties.

That's down from 13.2 percent of all seriously underwater homes, 7.3 million properties, in the first quarter of 2015.

But in the first quarter in Collier County, 13 percent, or 17,973 homes, had submerged loans.

Still, that was a drop from the first quarter of last year, when it was 20,744 homes, or 16 percent of all mortgaged homes in Collier.

In Lee County, 49,436 homes, or 18 percent of all mortgaged homes, were seriously underwater in the first quarter, RealtyTrac said.

But in the prior-year quarter, 62,902 homes, or 24 percent of all Lee homes with a loan, fell into that category.

'The high share of seriously underwater homeowners is mostly those who bought or refinanced during the housing bubble and have held on to their properties,' Blomquist said. 'Our data shows in Lee County, 65 percent of all seriously underwater homeowners bought or refinanced in 2005, 2006 or 2007. In Collier County it is 49 percent.'

Less than 1 percent of homes in either county would qualify for a principal reduction using eligibility criteria provided on the Federal Housing Finance Agency fact sheet, which loan services must offer to eligible buyers by year-end, RealtyTrac said.

The Irvine, California-based research company looked at homes that were in foreclosure and were owner-occupied, with estimated conventional loans of no more than $250,000.

In Collier, 28 homes would qualify under these criteria, and in Lee, 138, RealtyTrac said.

On the opposite end of the spectrum, Southwest Florida homes that are equity-rich, meaning they have a loan-to-value ratio of less than 50 percent, grew over the year. They also beat the national average.

Nationally, more than 12.3 million homes, representing 22 percent of all properties with a mortgage, were equity-rich, up from more than 11 million homes, or 19.8 percent of mortgaged properties a year earlier.

But in Collier County, 42,039 homes, or 31 percent of all mortgaged homes, were equity-rich in the first quarter, compared with 32,547 homes, or 26 percent of all homes, in the prior-year quarter.

In Lee, 29 percent, or 78,993 homes, were equity-rich in the first quarter, compared with 23 percent, or 59,379 homes a year earlier.

'Equity-rich homeowners represent those who either bought before the housing bubble or those who bought after it burst and have now benefited by a rapid bounce back in home prices,' Blomquist said.

He noted that in Lee County, 45 percent of equity-rich borrowers purchased or refinanced in 2009 or later, and another 42 percent purchased or refinanced before 2005. In Collier, 50 percent of equity-rich borrowers purchased or refinanced in 2009 or later, while 41 percent did so before 2005.

Mike Hughes, general manager of Downing-Frye Realty in Naples and immediate past president of the Naples Area Board of Realtors, concurred that timing is the prime factor in determining whether a homeowner lost or won equity during boom, recession and recovery.

'A lot also depends on the neighborhood where you bought,' Hughes said. 'My sense is that the area is largely above water and is in better shape than it was three or four years ago.'